Add yet another wrinkle to the convoluted mathematics of the Patient Protection and Affordable Care Act: repayments for health premium subsidies received by those deemed to be ineligible for them.
Under terms of the act, persons earning up to four times the federal poverty level ($46,680) are eligible for subsidies. But determining exactly who was eligible to receive such federal subsidies was an inexact process at best. Consider:
- Many were asked to estimate their annual income, with little supporting documentation required. Result: Some may have made more than the ceiling for subsidies.
- Immigrants at or below the subsidy level had to submit proof of residency status. But thousands have had trouble doing so, partly due to federal insurance website glitches.
- People employed by a company offering coverage who opted to get coverage from a state or federal exchange now will be asked to prove "looking backward" that they were eligible.
Soon will come the time for all those found to be ineligible for subsidies to repay the government. To add to the potential for another bureaucratic nightmare, the feds will be requiring different levels of repayment from different categories of recipients, according to an article in Kaiser Health News.
Recommended For You
A hue and a cry is already being raised around the issue by advocates for immigrants. They say there's no way all 300,000 who are being asked for further proof of residency can make the Sept. 5 deadline, given the sorry state of HealthCare.gov. Those who don't meet the deadline will, as things now stand, have to repay at least part of any subsidies received, as well as losing their coverage, Kaiser said.
But beyond the immigrants whose status is in question, others who have received subsidies may face repayment once the feds crunch the numbers.
"Such a rule would not just affect the 300,000 immigrants who have received notices requesting additional information. It could also apply to someone who had job-based insurance, for example, but was approved incorrectly for a subsidy through the new marketplaces. If later found ineligible because of that job-based coverage, that person would also owe the government what was paid to insurers on his behalf," Kaiser reported. "What's less clear is how much an ineligible person would have to pay."
The IRS has said repayments will be capped for low-income people who got subsidies beyond what they should have, but full repayments will be required of those whose income exceeded the 4X ceiling.
"Whether those caps apply to people who received subsidies but were later deemed ineligible is not clear," Kaiser said.
© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
Dan Cook
Dan Cook is a journalist and communications consultant based in Portland, OR. During his journalism career he has been a reporter and editor for a variety of media companies, including American Lawyer Media, BusinessWeek, Newhouse Newspapers, Knight-Ridder, Time Inc., and Reuters. He specializes in health care and insurance related coverage for BenefitsPRO.
